First-time home buyers continue to find few options

New home construction last week at the Yeager Farms neighborhood being built off Francis Street near 15th Avenue. (Matthew Jonas / Longmont Times-Call)

Young families and other first-time homebuyers on a modest income are continuing to struggle with a lack of available Longmont-area single-family residential inventory in their price range.

As of the end of June, the midway point of the year, there were just 12 single-family homes on the market priced at $200,000 or less, according to Kim Ranes, 2014 president of the Longmont Association of Realtors board of directors and the owner of Diamond 4 Realty. That's only 6 percent of the 194 total listings on the market in Longmont, she said.

"If you have somebody out there and they only qualify for $200,000, it's very difficult to find a move-in ready home," Ranes said, and she's not just speaking about Longmont proper. Since coming out of the Great Recession, prices have continued to climb throughout the whole region.

The median price for a single family home in Longmont has reached $269,500, according to statistics compiled for the LAR by Kyle Snyder of Land Title Guarantee Co. That's up 6.4 percent from the $253,250 of a year ago.

Median prices in Lafayette and Louisville are both well above $400,000, and prices in the Carbon Valley — long considered the place to go for homebuyers who couldn't afford Longmont, which is the least expensive city in Boulder County — have reached Longmont levels: According to Snyder's statistics, the median price in Frederick, Firestone and Dacono has reached $269,250, a nearly 12 percent increase over a year ago.

"There are things you can get out there for $200,000, but it's becoming a lot more rare," said Ranes, who works all over northern Colorado.

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Jane Tipton, a broker/associate with ReMax Traditions, said one client recently had to put seven offers on a house in that price range before their offer was finally accepted.

"I think we're still looking at a low inventory in that range," Tipton said. "And we're still looking at multiple offers on a lot of these properties."

Generally speaking, 2014 has been a very good year, the agents say. Snyder noted in his monthly newsletter that June was the second-highest closing month in Longmont since August 2005.

Though the number of homes sold year-to-date through the end of June is down in Longmont, Louisville and Boulder, all three communities saw steady price increases. And the number of days that houses sit on the market is down significantly in every part of the region except for Boulder.

"Interest rates have stayed really great," Ranes said. "That's a whole other side of it — people were predicting that they would be up this year, but they're really not."

Sabrina Lee, a mortgage loan officer for Elevations Credit Union, said the rates have surprised her as well.

"They keep telling us interest rates are going to be going up, but they're lower than they were a year ago," she said.

Lee said there are still options for people who have no money to put as a down payment on a house, but most of the programs that helped cause the housing crisis in the first place have gone away.

She said she recommends people come up with about 5 percent cash down because "it leaves the door wide open to pursue a lot of different financing options."

She said that one thing she's noticed is that while someone might pay $1,100 a month on a mortgage, that same house might be renting for $1,500 a month.

"Because rents are getting so high we're dealing with a lot of first-time homebuyers who want to buy because buying is cheaper than renting a house," Lee said.

But again, if it's a house around $200,000, those buyers will face a lot of competition trying to land one of those homes.

Ranes noted that because Snyder's statistics come from Multiple Listing Service statistics, the numbers are somewhat skewed because many builders building new homes never put all the homes they're building into the MLS database. This means that a portion of home-buying activity is not being tracked in the LAR statistics.

"There have been, this year, more 'solds' than we've seen on the MLS listings," Ranes said.

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